In which of the following situations would a disclaimer of opinion not be appropriate?

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Audit Reports
Under which circumstances would a disclaimer of opinion not appropriate?
Which of the following is an appropriate situation to use a disclaimer of opinion?
Under what two conditions must an auditor issue a disclaimer of opinion?
Under what circumstances is the expression of a qualified opinion appropriate?

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Audit Reports

Question	Answer
The Phrase "US generally accepted accounting principles" is an accounting term that:	Encompasses the conventions, rules, and procedures necessary to define US accepted accounting practice at a particular time.
Which of the following provides the most authoritative guidance for the auditor of a non issuer.	General guidance provided by statement of auditing standards.
For an Entity's financial statements to be presented fairly in accordance with a applicable financial reporting framework, the framework selected should:	Include an adequate description of the framework of the financial statements.
When qualifying an opinion because of an insufficiency of audit evidence, an auditor should refer to the situation in the:	Auditor's responsibility paragraph.
Under US auditing standards, when an auditor believes there is substantial doubt about the ability of an entity to continue as a going concern, all of the following should be included in the audit documentation, except:	management's conclusion regarding the substantial doubt remains or is alleviated.
In which of the following situations would an auditor ordinarily choose between expressing a qualified opinion or an adverse opinion.	Inadequate disclosure of the substantial doubt about an entities ability to continue as a going concern is a departure from GAAP, resulting in either a qualified or adverse opinion.
An auditor who is unable to form an opinion on a new client's opening balances may issue an unmodified opinion on the current year's:	balance sheet only.
How does an auditor make the following representations when issuing the unmodified audit opinion on comparative financial statements?	Implicitly for both consistent application of accounting principle and examination of evidence on a test basis.
In which of the following circumstances would the auditor not express an unmodified opinion?	The auditor is unable to obtain audited financial statements of a consolidated investee (unless immaterial).
An auditor decides to issue a qualified opinion on an entities financial statements because of an entities financial statements because a major inadequacy in its computerized accounting records prevents the auditor form applying necessary procedures.Why?	The possible effects on the financial statements.
When an entity changes its method of accounting for income taxes, which has material effect on comparability, the auditor should refer to the change in an emphasis of matter paragraph added to the auditor's report. This paragraph should identify:	The nature of the change and refer to the financial statement note discusses the changes in detail.
when an auditor expresses an adverse opinion, the opinion paragraph should include:	A direct reference to a separate paragraph disclosing the basis for the opinion.
Pell CPA, decides to serve on a group engagement partner in an audit of the F/S of Tech Inc. Smith CPA audits a subsidiary. In which situation should Pell make reference to Smith's audit under GAAS?	Pell is unable to review Smith's audit documentation.
Copper CPA, believes that there is substantial doubt about the ability of Zero corp to continue as a going concern for a reasonable amount of time. In evaluating Zero's plan for dealing with the adverse effect of the future events, Cooper most likely:	would consider postponing expenditures for research and development projects a mitigating factor.
Under which of the following circumstances would a disclaimer opinion be appropriate?	The financial statements fail to contain adequate disclosure of related party transactions.
An auditor may reasonably issue an "except for" qualified opinion for a:	Both a scope limitation and an unjustified accounting change.
"As discussed in Note T to the financial statment, the company changed its method of computing depreciation in year 2". How should the auditor report or this matter if the auditor concurred with the change?	Type of opinion = unmodified. Location of paragraph = after opinion.
Under US auditing standards, in which of the following situations would an auditor opinion paragraph change without an emphasis on matter paragraph?	The auditor decides to make reference to the audit of a component auditor as a basis in part for the auditor's opinion.
When there has been a change in accounting principle that materially affect the compatibility of the f/S's presented and the auditor concurs with the change, the auditor should:	Concur implicitly with the change, don't issue an "except for" qualified opinion, but refer to the change in an emphasis of matter paragraph.
Restrictions imposed by a client prohibit the observation of physical inventories, which account for 35% of all assets. Alternative procedures cannot be applied. The auditor should issue a:	disclaimer of opinion due to the materiality of the asset.
The auditor concludes that there is substantial doubt about an entity's ability to continue as a going concern for a reasonable period of time. If the entity's disclosures are adequate, the auditor reporting may include a:	disclaimer of opinion (or an unmodified report with an emphasis of matter paragraph).
An auditor should discclose the substantive reasons for expressing an adverse opinion in a basis for modification paragraph:	Preceding the opinion paragraph.
When management does not provide reasonable justification that a change in accounting principle is preferable and it presents comparative financial statements, The auditor should express a qualified opinion:	each year that the financial statements initially reflecting the changes are presented.
Which of the following is untrue regarding the audit report of an issuer?	reference should be made in the auditor's responsibility paragraph to the PCAOB Standards, and the opinion paragraph to GAAP.
A CPA concludes that the unaudited F/S on which the CPA is disclaiming an opinion are not in conformity with GAAP because mgmt has failed to capitalize leases. Management refuses to properly disclose the leases, under these circumstances the CPA would:	describe the nature of the departure from GAAP in the report and state the effects on the F/S.
Under ISA, The going concern period is:	At least one year from the date of the financial statements being audited.
When qualifying an opinion because of an insufficiency of audit evidence, an auditor should refer to the situation in the:	Basis for qualified opinion paragraph.
An auditor is unable to complete a procedure during an audit. Based on this situation which opinion is least likely to be rendered?	An adverse opinion )as it is not a departure from GAAP).
An auditor should consider which of the following when evaluating the ability of a company to continue as a going concern?	management's plan for disposal of assets.
When reporting on comparative F/S, an auditor ordinarily should change the previously issued opinion on the prior year's financial statements if the:	Prior year's F/S are restated to conform with GAAP.
Jewel CPA, audited infinite Companies prior year financial statements, These are presented with those of the current year for comparative purposes without Jewels auditors report with a qualified opinion. This years audit report by CRAM CPA, should:	Should not name the predecessor auditor, should indicate type of report issued and give reason for the qualification.
In May year 4, an auditor reissues the auditor's report on the year 2 financial statement at a continuing clients request. the year 2 F/S are not restated and the auditor does not revise the wording of the report. The auditor should:	Use the original report date in the reissued report.
In the first audit of a client, an auditor was not a able to gather sufficient evidence about the consistent application of accounting principle between current and prior year as well as beginning balances of the current year, if material:	The auditor would be unable to express an opinion on the current years' results of operations, and cash flows.
Jules, CPA, is reporting on comparative F/S, but Shah, CPA, conducted the prior years' audit. Which of the following is not true in this situation?	Dual dating may be used to indicate the appropriate dates for each audit.
which of the following is not true regarding the auditors responsibility for subsequent events?	The auditor has an active responsibility to make continuing inquiries between the date of the auditors report and the date on which the report is submitted.
which of the following procedures would an auditor most likely perform in obtaining evidence about subsequent events?	Investigate changes in long term debt occurring after year end.
Subsequent to the issuance of the report, the auditor becomes aware of facts existing at report date that would have affected the report. After determining the information is reliable, the auditor should next:	Determine whether there are persons relying or likely to rely on the financial statements who would attach importance to the information.
Wilson CPA obtained sufficient appropriate evidence to render an opinion on ABCO'S 12/31 year 1 F/S on 3/6 l year 2. A subsequent event requiring adjustment to year 1 F/S occurred on 4/10 of year 2 and Wilson became aware on 4/24.If adjusted in the F/S:	The report should be dated March 6, year 2, when fieldwork was complete.
Which of the following items would most likely require an adjustment to the financial statements for the year ended 12/31 year 1?	Loss on uncollectible trade receivables recorded in year 1 from a customer that declared bankruptcy in year 2.
which of the following is not true regarding an engagement to provide a written report on the application of the requirement of an applicable financial reporting framework?	A reporting accountant is prohibited from providing a report on the application of the requirements on an applicable financial reporting framework to a proposed future transaction regarding the facts and circumstances of a specific entity.
Which of the following is least likely with regard to supplementary info that is required by GAAP?	The auditor's report on the F/S's include both an opinion on the supplementary info and a statement restricting the use of the report.
In connection with a proposal to obtain a new audit client, a CPA in public practice is asked to prepare a report on the application of the requirements of an applicable financial reporting framework to a specific transaction. The CPA's report should:	include a statement that the responsibility of the proper accounting treatment rests with the preparers of the financial statements.
A auditor is engaged to report on selected financial data that are included in a client prepared document containing audited F/S. Under these circumstances, the report on the selected data should:	Be limited to data derived from the entity's audited F/S's
The 4th standard of reporting require the auditor's report to contain either a expression of opinion regarding the financial statements taken as a whole or as the assertion that an opinion cannot be expressed. This standard is meant to:	eliminate misinterpretations regarding the degree of responsibility the auditor is assuming.
How does an auditor make the following representations when issuing the standard auditor's report on comparative F/S's?	Consistency of application is is implicit, and examination of evidence on a test basis is explicit.
When an auditor qualifies an opinion due to inadequate disclosures in a non-issuers F/S for a period ending before 12/15/12, The auditor should describe the nature of the omissions in a separate explanatory paragraph and modify the:	Neither the intro or the scope (explanatory and opinion only).
which of the following best describes what is meant by the term GAAS?	measures of the quality of the auditor's performance.
In certain audit engagement, the auditor may be required to comply with auditing requirements in addition to GAAS. The auditor may conduct the audit in accordance with:	Both GAAS and Government auditing standards (GAGAS).
which of the following phrases should be included in the opinion paragraph when an auditor expresses a qualified opinion?	Not either "when read in conjunction with note "X" or "with the foregoing explanation". Proper= "in our opinion, except for as discussed in the preceding paragraph..."
An auditors responsibility to express an opinion on the F/S under US auditing standards is:	Explicitly mentioned in the Auditors responsibility paragraph.
When a auditor qualifies an opinion because of the inabilities to confirm a/r by direct communication with debtors, the wording of the basis of qualified opinion paragraph should indicate:	The qualification pertains to the possible effects of the financial statements.
Tech. Co. has discussed an uncertainty due to pending litigation. The auditor's decision to issue a qualified opinion rather than an unmodified opinion most likely would be determined by the:	Lack of sufficient evidence.
An auditors report under US auditing standards that refers to the use of an accounting principle at variance with GAAP contain the words" in our opinion, with the foregoing explanation, the Financial statements referred to above present fairly. This is:	Example of inappropriate reporting (should be preceding paragraph).
An auditor may issue a qualified opinion under which of the following circumstances?	Lack of sufficient appropriate audit evidence and restrictions of the scope of the audit.
When a group engagement partner decides to make reference to a component auditors' examination under US GAAS, the group engagement partners report should state "we did not audit the financials of X company" in which paragraph of the audit report?	Auditors responsibility report.
For a particular entity's financial statements to be presented fairly in conformity with the applicable financial statements reporting framework it is not required the the principle to be:	Applied on a basis consistent with those of the the prior year.

Under which circumstances would a disclaimer of opinion not appropriate?

A disclaimer is issued when the scope limitations pertaining to the audit are so pervasive that the auditor in unable to express an opinion. Lack of adequate disclosures in the financial statements is a GAAP departure, not a scope limitation. Thus, a disclaimer of opinion would not be appropriate.

Which of the following is an appropriate situation to use a disclaimer of opinion?

Under which of the following circumstances would a disclaimer of opinion be appropriate? The chief executive officer is unwilling to sign the management representation letter. Issue an unmodified opinion in regard to financial position and disclaim an opinion in regard to the results of operations and cash flows.

Under what two conditions must an auditor issue a disclaimer of opinion?

This disclaimer may be given for several reasons. For example, the auditor may not have been allowed or been able to complete all planned audit procedures. Or, the client restricted the scope of the examination to such an extent that the auditor was unable to form an opinion.

Under what circumstances is the expression of a qualified opinion appropriate?

A qualified opinion should be expressed when the auditor concludes that an unqualified opinion cannot be expressed but that the effect of any disagreement with management, or limitation on scope is not so material and pervasive as to require an adverse opinion or a disclaimer of opinion.

In which of the following situations would a disclaimer of opinion not be appropriate?

Audit Reports

Under which circumstances would a disclaimer of opinion not appropriate?

Which of the following is an appropriate situation to use a disclaimer of opinion?

Under what two conditions must an auditor issue a disclaimer of opinion?

Under what circumstances is the expression of a qualified opinion appropriate?

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